5.2. SR 11-24-2003TO:
FROM:
DATE:
SUBJECT:
Item 512.
MEMORANDUM
Mayor and City Council
Lori Johnson, Finance Director
November 24, 2003
Consider Non-Union Health and Dental Insurance Contracts
On Wednesday the final health insurance rate information for the non-union employee
insurance contract was received. The insurance agent and I started the renewal process in
August by discussing options available to our group. After receiving renewal rates from
HealthPartners, a decision was made to request rates from Medica. Although this carried
some risk because if Medica's rates were high, it took away any negotiating power we
had with HealthPartners, we felt it was worth the risk. We simply could not accept
HealthPartners' renewal with an increase of up to 22 percent for some plans.
In the end the risk paid off as Medica submitted rates that are almost the same as last
year's rates. This is great news in an environment where health care costs are increasing
approximately 15 percent and 20 percent rate increases are common. Although it is
difficult to make direct comparisons because of the differences in networks, Medica's
rates are very good. Medica's networks are broader so some employees may actually see
a decrease in their premiums because they now find that their doctor or clinic is included
in Medica's cheaper plan network (Elect/Essential) unlike HealthPartners where they had
to purchase a more expensive plan. Attached is a rate comparison spreadsheet with more
detailed information on the rates.
Plan options with Medica for 2004 will again include a $15 co-pay plan and a $500
deductible plan. In 2003 32 percent of the employees took the basic $500 deductible plan
and the remaining 68 percent bought the more expensive plan.
Also, dental insurance is up for renewal on January 1. HealthPartners did not increase
rates for dental insurance so it is recommended that the dental contract be renewed.
Finally, I will be present at Monday's meeting to answer any additional questions you
may have. Employees will receive a copy of this memo prior to the meeting so they will
have the information before the Council takes action. Employee meetings will be held in
December to provide employees with additional information on the new insurance plan.
Action Requested
The Council is asked to award the 2004 non-union health insurance contract to Medica
and to renew the dental insurance contract with HealthPartners.
2004 HEALTH DENTAL INSURANCE RENEWAL
$15 Copay
Plan
Name
Health Health
Partners Partners Plan
Current Renewal Medica Name
Classic ME100
Single 288.40 362.30 290.43
Single & Spouse 588.95 739.88 593.10
Single & Children 524.16 658.48 527.85
Family 976.99 1,227.36 983.87
MICME/MES17
MIC Elect/Essential
(Medica Elect/Essential rates include Allina Clinics included in HealthPartners' Primary network.
Because HealthPartners and Medica have different networks, plan comparisons are difficult.)
Primary HP60
Single 311.77 n/a
Single & Spouse 636.70 n/a
Single & Children 566.65 n/a
Family 1,056.20 n/a
(HealthPartners combined the Primary and Open plans for the 2004 renewal.)
Open HPA60 MIC17
Single 336.72 381.37 322.68
Single & Spouse 687.64 778.82 658.98
Single & Children 611.99 693.14 586.48
Family 1,140.70 1,291.96 1,093.16
(HealthPartners renewal combines Primary and Open plans. HealthPartners and Medica
networks are different.)
MIC Choice Select
$500 Deductible
Classic ME101
Single 239.68 292.41 247.48
Single & Spouse 489.46 597.14 505.39
Single & Children 435.61 532.05 449.79
Family 811.94 991.71 838.37
MICME/MES500
MIC Elect/Essential $500 Deductible
(Medica Elect/Essential rates include Allina Clinics included in HealthPartners' Primary network.
Because HealthPartners and Medica have different networks, plan comparisons are difficult.)
Primary HD12
Single 259.10 n/a
Single & Spouse 529.14 n/a
Single & Children 470.92 n/a
Family 877.77 n/a
(HealthPartners combined the Primary and Open plans for the 2004 renewal.)
Open HPA62 MIC500
Single 279.84 308.15 274.97
Single & Spouse 571.47 629.29 561.54
Single & Children 508.60 560.06 499.76
Family 948.00 1,043.90 931.52
(HealthPartners renewal combines Primary and Open plans. HealthPartners and Medica
networks are different.)
MIC Choice $500 Deductible
DENTAL
Single 26.04 26.04
Family 68.02 68.02
NOTE: For more information on the networks for these plans go to Medica.com and HealthPartners.com.
11/21/2003